Priceline Beats Profit Estimates as Room Night Bookings Growby
Like Expedia, Priceline saw travel to France hurt by attacks
Priceline search for new CEO continues, interim chief says
Priceline Group Inc. topped profit estimates as the number of hotel rooms booked through its websites increased and the impact of terrorism on tourism to Europe was muted. Shares jumped as much as 6.2 percent in extended trading after the results were released.
- Second-quarter earnings per share, excluding some items, were $13.93, compared with the average analyst estimate of $12.67.
- Revenue increased 12 percent to $2.56 billion, the company said Thursday in a statement. Analysts projected $2.6 billion.
- Profit in the third quarter, excluding certain items, will be $28.30 to $29.80 a share, compared with analysts’ estimates of $29.04. Third-quarter revenue will increase 12 percent to 17 percent from a year earlier, or $3.47 billion to $3.63 billion, compared with the average estimate of $3.57 billion.
- Gross travel bookings, the total amount of money spent by customers on Priceline’s websites, increased 19 percent to $17.9 billion, compared with about $15 billion in the same period a year earlier.
The Big Picture
Priceline is working to keep up revenue growth and face down numerous challenges including terrorism fears damping travel to Europe, hotel consolidation making it harder to charge high percentages of booking fees and the possibility of new players like Google stepping up their presence in the market. The Norwalk, Connecticut-based company is looking for a new chief executive officer after Darren Huston resigned in April because he broke Priceline’s code of conduct by having a personal relationship with an employee.
- “We definitely have seen softer travel demands in markets affected by attacks,” Chairman and Interim Chief Executive Officer Jeffery Boyd said in a phone interview. France and Belgium were most directly affected, but consumers are still traveling to other European countries. Travel to Turkey also dropped off after the country’s failed coup, he said.
- The search for a new CEO is continuing and the company plans to take as much time as it needs to find the right candidate, Boyd said.